US stocks retreat as oil surge and AI sell-off unsettle markets
Wall Street opened the week on the defensive as Brent crude approached US$106 a barrel, Middle East hostilities escalated and major AI shares declined ahead of the Federal Reserve’s policy decision.
US stocks fell on 14 September as rising oil prices, escalating hostilities in the Middle East and weakness in AI shares weighed on markets ahead of this week’s Federal Reserve meeting.
Brent crude rose more than 3% towards US$106 a barrel after attacks on shipping in the Strait of Hormuz. A drone strike also prompted Saudi Arabia to temporarily shut its East-West pipeline, developments that added to pressure in energy markets after Brent gained almost 9% the previous week.
The S&P 500 declined, while Nvidia, AMD and Sandisk shares fell after Anthropic chief executive Dario Amodei called for slower development of frontier AI models over safety concerns.
Daniela Hathorn, senior market analyst at Capital.com, said markets were starting the week on a defensive footing, with Middle East tensions and increasingly hawkish central-bank expectations weighing on risk appetite.
The Federal Open Market Committee is due to announce its interest-rate decision and hold a press conference on Wednesday. Market pricing cited by Hathorn indicated roughly an 85% probability of a 25-basis-point hike, although the decision had not been confirmed.
The retreat followed a stronger session on Friday, when the S&P 500 ended a four-day losing streak as oil prices fell and inflation data met expectations.
